The driver of the bus was dropping off a passenger on Capitola Road across from the mall about 5:24 p.m. when he looked in his rear-view mirror and noticed smoke coming out of the diesel engine, Battalion Chief John Walbridge said.
He evacuated the bus and hit an emergency button that notified a supervisor, Walbridge said.
When firefighters arrived, flames were burning into the passenger compartment, he said.
The engine was destroyed while the passenger area sustained mostly smoke damage, he said.
Walbridge said the engine was so badly destroyed that the cause of the blaze may not ever be known.
He said it was unusual and that those buses are typically well-maintained.